Apple announced a 4:1 stock split on July 31 and today Tesla announced a 5:1 stock split. The Tesla stock split would convert Tesla from a $1400 stock to five $280 share.
Apple shares went up about 15% after the stock split announcement. Tesla was up 6-8% in after-hours.
SOURCES – Tesla, Apple
Written By Brian Wang, Nextbigfuture.com, Brian owns shares of Tesla
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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I think it is a perception issue. Logic isn’t in the deck.
Plenty stock trading companies now allow you to buy partial shares, so this seems a non-benefit now.
It’s probably irrational, I agree, though a split in the value makes it more fungible such that some people who could not buy a 1400 USD stock can perhaps buy two stocks for 560 USD and thus raise the demand. So perhaps some valuation is to be expected, but whether 6–8% is “just right” requires someone with more of the right kind of skills than I.
It’s kind of crazy that a stock split would cause the stock price to rise. A little irrational Exuberance has infected the market